Founding Fathers On Finance

Don’t bail out debt with more debt.
George Washington wrote in 1799 to James Welch, “To contract new debts is not the way to pay for old ones.”
Thomas Jefferson similarly admonished Samuel Kercheval in 1816, “To preserve [the] independence [of the people], we must not let our rulers load us with perpetual debt.”

I am listening to the financial news again this morning with chagrin. I am concerned that the federal government is interfering too much in the current economic crisis. So I went online to find some guidance from our Founding Fathers. I found an article that expresses some of what I feel. I am linking it to the title of this post. I am also including some of the article here in my post. It is too long to include the full article. The article is written by Chuck Norris, World Net Daily. Some of the article follows here in excerpt.

"Yes, it’s official and public news for the whole world to see: Government is the worst run business on the face of the planet. We’ve known it for a long time – we’re just now facing the monetary music. We’re going under, fast. And the government’s remedy is to return to its cycle of treasury vomit – spending money it doesn’t have by borrowing money it can’t pay back. But the cat’s costs are out of the bailout bag, too. Fannie May, Freddie Mac, AIG insurance, etc., are all birth pains of greater taxpayer burdens to come. The Fed’s rescue plan will cost Americans another $1 trillion dollars – for those doing the math, that’s roughly $3,600 each in taxes.

But most Americans’ pocketbooks are barren wastelands – with maxed payments, mortgages and consumer credit. So where will the Fed get another trillion dollars when it already holds a $9 trillion dollar deficit? From the same black hole it got the preceding $9 trillion. We make more money and lessen the value of the dollar; we borrow more money and lose our grip on our nation. America is up for sale. And foreign entities and powers are buying up our debt to own a large piece of the pie called America. We are literally mortgaging our land and liberties – and our children’s future. And our government is not only doing nothing to stop it – it is the bureaucratic broker arranging the deal!

1. Keep spending within constitutional limits. The Tenth Amendment restricts the size of government, and that should always bear out in the federal budget and spending. That means understanding income and export taxes were unconstitutional to our founders, which if applied today would be two of the greatest economic stimulus packages.
2. Don’t bail out debt with more debt. George Washington wrote in 1799 to James Welch, “To contract new debts is not the way to pay for old ones.” Thomas Jefferson similarly admonished Samuel Kercheval in 1816, “To preserve [the] independence [of the people], we must not let our rulers load us with perpetual debt.”
3. Return to a pay-as-you-go government. If we don’t have the money, we don’t spend it. As Thomas Jefferson once wrote to Fulwar Skipwith in 1787, “[T]he maxim of buying nothing but what we had money in our pockets to pay for …[is] a maxim, which, of all others, lays the broadest foundation for happiness.”
4. Tax for imports, not exports or anything else. Our earliest government’s primary tool to raise revenue was from tariffs. Obviously, we can’t raise all the monies our government now needs by imports alone (because of its excessive taxation dependence through the decades), but we need to return to our founders’ simple taxation system. Early Americans did not pay income taxes, export taxes, capital gains taxes, estate and property taxes, corporate taxes, social security taxes, gas taxes or any of the rest of them we pay. However, our founders did build revenue by requiring import taxes from those who wanted to sell us their goods. The fact is, most of our taxes are unconstitutional and would therefore be illegal to our founders. As James Madison said in his “Address to the States” in 1783: “Taxes on consumption are always least burdensome, because they are least felt, and are borne too by those who are both willing and able to pay them; that of all taxes on consumption, those on foreign commerce are most compatible with the genius and policy of free States.”
5. Get over the greed. We’re in this financial mess because of greed. Why is government spending out of control? Greed. Why do we as individuals and as a nation keep falling deeper into a pit of debt? Greed. We need, we want and we have to have it. We can’t afford it, but we can’t say no. So we charge it, deferring the penalty. Alexander Hamilton, the first secretary of the Treasury, believed a government that could use greed to motivate its people would become powerful and wealthy. Unfortunately, he was correct. We’ve become a nation that confuses our needs and greeds – and we’ve got to get back to the basics if we’re ever to understand and overcome the heart of this financial crisis.

Many of the founders warned about America’s potential fiscal woes under the power of a central bank. Thomas Jefferson was one of Hamilton’s biggest opponents, almost prophesying as president in 1803 to Albert Gallatin, “This institution is one of the most deadly hostility existing, against the principles and form of our Constitution. … I deem no government safe which is under the vassalage of any self-constituted authorities, or any other authority than that of the nation, or its regular functionaries. What an obstruction could not this Bank of the United States, with all its branch banks, be in time of war? It might dictate to us the peace we should accept, or withdraw its aids. Ought we then to give further growth to an institution so powerful, so hostile? … Now, while we are strong, it is the greatest debt we owe to the safety of our Constitution, to bring its powerful enemy to a perfect subordination under its authorities.”

What we need today is far more men and women in government with our founders’ financial forethought and cautiousness."

I hope I haven't bored you to death, but I believe that each of us need to be aware of the ramifications of the steps that the government is taking to bail out the economy. For this nation to go further in to debt is going to come back to haunt us. Each of us must understand the consequences and vote wisely. I believe that our founding fathers were led by God-and they so acknowledged. We would do well to look to them now in our time of crisis. There is a lot more to this article that I have cited. If you are interested in the full text, here is the URL. It will take you to the complete article. http://www.worldnetdaily.com/index.php?fa=PAGE.view&pageId=75867